METALS-Copper posts 2nd weekly loss on China slowdown fears

By Chris Kelly and Maytaal Angel NEW YORK/LONDON, (Reuters) - Copper fell for a second-straight week onFriday, trading lower in reaction to Europe's escalating debt crisis and anotherround of data confirming a slowdown in top metals consumer China. Copper bulls were dealt a serious blow on Friday after a string of data fromChina, including below-forecast industrial output, retail sales, fixed assetinvestment and copper production, suggested a further deceleration in growthfrom a region of the world that accounts for nearly 40 percent of the world'scopper demand. "This is certainly not helping the bull case," said Michael Gross, futuresanalyst with Optionsellers.com in Tampa, Florida. "There's been this theme over the last few months of growth slowing inChina, and it's now confirmed in the numbers." London Metal Exchange (LME) three-month copper shed $92 or nearly 1percent to close at $8,013 a tonne. In New York, the July COMEX contract ended down 4.25 cents at $3.6480per lb, after dealing between $3.6165 and $3.6835. For the month, copper prices in both London and New York have lost nearlyfive percent, slicing the year's gains in half. COMEX copper volumes, at around 59,100 lots in late New York trade, slowedto almost a quarter below their 30-day average, according to preliminaryThomson Reuters data. On top of the softer Chinese data, copper investors also had to contend withinconclusive election results in Greece this week that threw the country intopolitical disarray, as well as a huge trading loss from JPMorgan, whose failedhedging strategy rattled most risk asset markets on Friday. But providing some salve was U.S. consumer sentiment that rose to itshighest level in more than four years in early May. "When you see the Chinese data out today and the trade data yesterday,copper should be going lower," said analyst David Wilson of Citi. "But the tightness on the LME is probably supportive and every time it doesget to the $8,000 a tonne level, consumers do appear to buy buying into that,"he added. Latest data showed LME copper stocks climb 1,425 tonnes at 221,275 tonnes,near their lowest levels in 3-1/2 years. Shanghai's copper stockpiles fell 13percent last week, though they remain elevated near a 10-year high of 227,276tonnes hit in March. Reflecting tight supply outside China, the cost to rolling short positionsfor nearby copper on a tomorrow/next day basis, for delivery next week, remainsexpensive at $3.77 on Friday, although down from a high of $13.00 earlier in thesession. With the prime prompt date for May next week Wednesday, costs to roll shortpositions could climb further, traders said, if metal for delivery can't befound. In news, Poland's copper miner KGHM does not expect the averageannual price of copper to drop below $8,000 per tonne, the group's ChiefExecutive Officer Herbert Wirth told Reuters on Friday.

INDO NICKEL Across other metals, Indonesia plans to introduce new quotas to limitmineral exports, as well as a 20 percent duty on mineral exports by certaincompanies, Indonesian government officials said on Friday. "(An) export tax will put a solid floor under LME nickel prices, but wedon't see a supply shortage any time soon," ANZ said in a research note. Support also came as Vale, the world's second-biggest nickelproducer, said on Thursday it would suspend sales and purchase agreements at itsGoro project on the French Pacific island of New Caledonia after an accident atthe mine's sulfuric acid plant. Nickel closed up $30 at $17,195 a tonne. In other metals, lead ended off $18 at $2,072 a tonne. Doe Run Co restored its primary lead smelter in Herculaneum, Missouri, thisweek to its full production capacity of 130,000 short tons a year and is ontrack to meet its production target for May, a company executive said onThursday.